Sidhu v. 690174 B.C. Ltd.

2016 BCSC 923 Sidhu v. 690174 B.C. Ltd.

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Sidhu v. 690174 B.C. Ltd., 2016 BCSC 923 Date: 20160317 Docket: S153116 Registry: Vancouver Between: Sumit Sidhu, Manisha Kaur Sidhu, Gurmit Singh Sidhu, Onkar Singh Malli, Manmeet Singh Malli, Malkiat Singh Bains, Joginder Singh Chahal and Harjinder Kaur Bassi Plaintiffs And 690174 B.C. Ltd., 731431 B.C. Ltd., 892995 B.C. Ltd., Panorama Parkview Homes Ltd., Grewal Management Ltd., Jaswant Singh Sangha, Parmjit Kaur Sangha, Raveen Sangha, Ranjit Singh Sangha, Svender Singh Sangha, Douglas William Wills, Balbir Kaur Dale, Jasprit Singh Grewal, Daljit Singh Garcha, Jaswinder Kaur Garcha, Westminster Savings Credit Union, Jatinder Virk, B & B Contracting Ltd., Daljit Singh Mattu, Rajpreet Singh Sangha, Sarbjit Kaur Mattu, Gursharan Kaur Johal, Surjit Singh Heer, Makhan Singh Bhandal, Mandeep Kaur Bhandal, John Doe and Jane Doe Defendants Before: The Honourable Madam Justice B.J. Brown Oral Reasons for Judgment In Chambers Counsel for the Defendant B & B Contracting: D. Moseley Counsel for B Con Developments Ltd.: S. Stephens Counsel for Crowe MacKay & Company Ltd.: V. Tickle Counsel for 731431 B.C. Ltd., 892995 B.C. Ltd., Grewal Management Ltd., Jasprit Singh Grewal, Daljit Singh Mattu, Sarbjit Kaur Mattu, and Rajpreet Singh Sangha: J. Wolfe Counsel for the Defendants, Douglas William Wills and Balbir Kaur Dale: Douglas

Wills (Appearing in Person) Counsel for Daljit Singh Garcha and Jaswinder Kaur Garcha: G.A. Phillips Place and Date of Trial/Hearing: New Westminster, B.C. March 7, 2016 Place and Date of Judgment: New Westminster, B.C. March 17, 2016 [1] THE COURT: I will start first with the Sidhu matter. The applicant B Con Developments Ltd. applies for an order fixing a new completion date for contracts of purchase and sale of certain development lots. [2] These proceedings are part of a series of related proceedings arising from the development of certain properties. On May 26, 2015, Mr. Justice Masuhara ordered that any of the unsold subdivision lots, the legal descriptions of which were attached, may be sold subject to the agreement of the parties or the approval of this court. The order provided that any of the parties were entitled to present offers to purchase subdivision lots and any of the offers to purchase were to be circulated to specified parties. If all of those parties agreed to the sale of the subdivision lots, the property would be sold in accordance with the terms of Mr. Justice Masuhara's order. If any of the parties failed to approve an offer, then any of the parties could apply to the court for approval of the offer and on approval by the court the sale of the property would proceed. [3] On October 9, 2015, Madam Justice Wedge approved the sale of 10 of the subdivision

lots. Six sales were approved to the applicant B Con. The contracts of purchase and sale and the order approving sale provided the following term with respect to the completion date. the sale will be completed on 30 days after court approval at the appropriate land title office. (Contract) the sale transaction contemplated by the agreement a copy of which is attached to this order is hereby approved the parties, with the consent of the purchaser, shall be at liberty to extend the closing date by up to 30 days without the necessity of a further order of this court. (Order) [4] Thirty days following the order of Madam Justice Wedge would be November 9, 2015. The purchaser did not complete by November 9, 2015 or by December 9, 2015. The parties did not agree to extend the completion date. [5] The purchaser now seeks an order fixing a new completion date for the sales. The purchaser does so on the basis that where neither party is prepared to close the transaction on the closing date specified in the relevant agreement, the contract continues to subsist if the purchaser remains ready, willing and able to complete. It is up to the court to fix a reasonable time for completion. [6] The purchaser says that neither party was able to close on the completion date. The breach was committed by both vendor and purchaser. Accordingly, the purchase agreements will continue to subsist and a

new completion date ought to be fixed by the court. The purchaser says that the court has the jurisdiction to extend the completion date and should do so as otherwise B Con stands to lose its $60,000 deposit. [7] The application is opposed by a number of parties: 731431 B.C. Ltd., 892995 B.C. Ltd., Grewal Management Ltd., Jasprit Singh Grewal, Daljit Singh Mattu, Sarbjit Kaur Mattu, and Rajpreet Singh Sangha, who I will refer to as the Grewal defendants. They take the position that completion dates for the contracts of purchase and sale of the B Con lots was November 9, 2015, with the option to extend for 30 days. At no time prior to November 9, 2015 did B Con or its solicitor deliver appropriate closing documents to the solicitor for the vendor. The parties did not consent to a 30-day extension. Accordingly, the B Con contracts are void as B Con failed to meet its contractual obligations and was not ready, willing and able to complete the contracts on the completion date. [8] The trustee in bankruptcy for Jaswant Singh Sangha also opposes the relief sought by B Con. The trustee is of the view that the value of the properties has likely increased since the purchase agreements with B Con. The trustee has a duty to realize as much as possible from Mr. Sangha's assets for the benefit of creditors. The trustee is of the view that the sale of the properties to B Con would not

represent the best realization of the interest of the Sangha entities in the properties. [9] The application was also opposed by the respondents Daljit Singh Garcha and Jaswinder Kaur Garcha, the Garcha defendants. It is their position that 10 approved sales contemplated closing of 30 days from court approval. Four of the 10 completed as contemplated. The six sales to B Con did not complete. The Garcha defendants take the position that B Con's failure to complete was entirely its own fault and should not permit B Con to avoid the closing date as set out in the six vested orders. Discussion [10] The applicant relies on the proposition of law stated in several cases before me, notably Madam Justice Southin in Shaw Industries v. Greenland Enterprises, [1991] 54 B.C.L.R. (2nd) 264 at 271 where she says: What is the legal position when both sides are in breach of obligations under a contract in which time is of the essence? The answer Miss Satanove propounds is that, as a matter of law, time ceases to be of the essence and either side can then give to the other a notice to complete the transaction at a new time. [11] In Basra v. Carhoun, [1993] B.C.J. No. 1648 the Court of Appeal said: In the case at bar, then, it is clear that time ceased to be of the essence on February 28, 1990 when neither party was ready to close the transaction, but on that date the contract still sub­sisted.

Therefore, the purchasers were entitled to give the vendor reasonable notice that they wanted to complete. In my opinion, such notice was given when the plaintiffs commenced this action. Indeed, the respondents conceded in their factum that the pur­chasers satisfied the notice requirement by promptly commencing their action. [12] None of the parties before me take exception with these statements of the law. The issue is with respect to the evidence. [13] I am not persuaded that both sides to this transaction were in breach of obligations; that neither was able to complete on the completion date. Mr. Singh, solicitor for the purchaser, appears not to have read or, at least, not to have noticed the term of the agreement as adopted by the court, or the court order. On his evidence, he was misled by the conveyancing instructions received from the real estate agent and believed the closing date was December 16, 2015 rather than November 9, 2015. [14] The real estate agent was also the agent of the purchaser, as the seller's fee agreement appended as Exhibit A to the affidavit of Mr. Singh sworn February 9, 2016 indicates. The seller's fee agreement provides that: In consideration of the buyer's brokerage (Re/Max Blueprint Realty) introducing the buyer to the seller or showing the property to the buyer through its licensee Brenda Lee/ TJ Samra (designated agent) the seller covenants

and agrees with the buyer's brokerage as follows: The designated agent is the agent for B Con Development Ltd. (the buyer) who may be interested in buying the property. [15] That document is signed by Brenda Lee on behalf of RE/MAX Blueprint Realty and by the buyer, who acknowledges an agency relationship with the designated agent. Accordingly, both the real estate agent who prepared the conveyancing instructions and Mr. Singh were acting on behalf of the buyer. There was no action by the seller or by the parties to the order of Madam Justice Wedge which induced Mr. Singh's misapprehension. [16] B Con argues that because Mr. Hogan, the vendor's conveyancing solicitor, was of the view, as stated in an e-mail on December 16, 2015, that the Land Title Office had rejected three of the four court orders for sales which had previously closed and that issue needed to be addressed and corrected before these six sales could complete; that the vendors were necessarily not able to complete on the closing date of November 9, 2015. [17] I am not persuaded on the evidence before me that this is so. I am advised that the other four sales did complete. I do not know how the issue raised by the Land Title Office was addressed. I do not know, based on the evidence, that had B Con proceeded to complete or attempt to complete on these six lots on November 9th that those sales would not have

completed or could not have completed. [18] I am also not persuaded that there was anything that the vendor's solicitor was required to do and failed to do such that the vendors were not in a position to complete as required on November 9, 2015. The order of Madam Justice Wedge required Buckley Hogan: As soon as reasonably practicable prior to closing and, in any event, prior to disbursing funds in accordance with paragraph 10 of this order, Buckley Hogan shall circulate to the parties a statement of adjustments and a direction to pay itemizing all disbursements proposed to be made from the sale of the lands. (Parties is a defined term in the order.) [19] That does not indicate that Buckley Hogan will prepare the statement of adjustments and, indeed, it appears that Mr. Singh prepared the statement of adjustments. It was reviewed by Buckley Hogan and Buckley Hogan required amendments to it. [20] Thus, I am not satisfied that the failure to complete by November 9, 2015 resulted from any failure on the part of Buckley Hogan or other parties as defined in the order of Madam Justice Wedge. The failure to complete appears to be solely due to the misunderstanding of Mr. Singh, as solicitor for the purchaser, and RE/MAX Blueprint as agent for the purchaser. [21] There is no suggestion that Buckley Hogan advised Mr. Singh that the completion date would be December 16 and no suggestion

that anything that Buckley Hogan did led to this misapprehension. As Mr. Hogan in his e-mail to the parties of February 15, 2016 said: We were not involved with the selection of those completion dates and do not know how they are arrived at. For those unfamiliar with conveyancing, the initial closing documents are prepared by the buyer's lawyer. The seller's lawyer only prepares our documents after receiving those from the buyer's lawyer. The only anticipatory work the seller's office would have is to obtain payout statements. For these deals, the order already dealt with that. So we had only to wait for documents from the buyer's lawyer. [22] There is nothing in the order of Madam Justice Wedge which placed Buckley Hogan under an independent obligation which would put the vendor in a position to complete on November 9, 2015. Accordingly, I am not satisfied that the cases relied on by the applicant contemplating the failure by both parties to complete on the completion date applies in this case. [23] The application is dismissed. "B.J. Brown J."